Your credit score is considered for many essential things in your life, like getting a mortgage, phone contract, and much more.
However, a whopping 75% of drivers are unaware that their credit score can also impact their car insurance rate.
It’s worth spending some time analysing your credit score and figuring out how you can improve it. A credit rating is an indication of how a lender will assess you. For example, your credit score may indicate future financial behaviour, how many applications you’ve made recently, and how much you currently owe.
For car insurance, those with higher credit scores are likely to receive lower premiums for car insurance.
As car insurance rates rise, it is an excellent idea to improve your credit score so you can attain better deals. Students, of course, will probably want the cheapest deal available for car insurance.
Age and experience
As a rule of thumb, the younger you are, the more you will be charged for car insurance. Young drivers have less driving experience and are more likely to get into car crashes. Once you reach the age of 25, these premiums are likely to lower.
Claims history
If you have been involved in any claims in the last five years, it will likely impact your car insurance rate – even if the claim wasn’t your fault.
Vehicle types
If you drive a more expensive car, your car insurance is likely to be higher. It will cost your insurance provider more to fix the car if it is damaged, resulting in a higher premium. This also applies to your car’s engine and how much it would cost to fix it if damaged.
Occupation
Some job roles are considered riskier than others. Consider tweaking your job role to lower your insurance premium. For example, you could select ‘kitchen worker’ over ‘chef’ in your job title section. Please make sure your job title still aligns with the appropriate industry and maintains a level of accuracy.
Fortunately, there are multiple ways to improve your credit score so you can achieve the best car insurance deal. By simply joining the electoral register can boost this, students can consider getting a short-term loan to prove you can borrow and payback on time.
Car insurance providers will assess your credit score to predict their insurance losses. If you have missed payments regularly, lenders may flag up your behaviour as risky. Those with a poor credit history are more likely to claim car insurance.
